With social venture projects in Africa, there is generally a team of social venture partners on the ground who are responsible for managing the project and the day-to-day operations. For example, I’m currently working with an organic farmer in community farming projects in Africa, where there is a local non-profit organization with six full-time workers (providing free seeds and education to the local community), a for-profit farm manager (providing oversight and management to the community farmers) and the local community providing land and workers. These are the project managers and workers who run the project on the ground. Every organization, including the United Nations, USAID and the World Bank work with local partners on projects in Africa.[1]

With the initial farming social venture, the mining project and the tourism project, our local project manager was Michael van der Merwe and his brother, Pieter van der Merwe. Whenever funding is needed on the ground in Africa for the social venture projects, there is a team of people who become financial partners and others who generally work on the projects. In our projects, the funding partners were part of limited liability companies in the United States or a United States non-profit corporation. The funding project company was managed by Pure Africa and funds were loaned to the social venture project in South Africa. Those loan funds were then managed by the social venture project manager and invested into the project or used to pay project fees and expenses. Finally, the financial partners would receive loan documentation and social venture project ownership for their loan to the social venture project or, in the case of funding provided by a US non-profit corporation, like Earth Conservancy, the funding was sent in the form of a grant.

The loan funds would then be under the control of the local social venture project manager, who had the responsibility of managing those funds to complete the projects and then repay the loan. At Hole in the Wall and on the Wild Coast of South Africa, our local partner was Bossie Bosman, who was one of the founders of the social venture work at Hole in the Wall and other projects. Like with Michael van der Merwe, funding for the Hole in the Wall project was generally wired from the United States to Bossie Bosman, who had responsibility of managing those funds, completing the project and repaying the loan.

Although we had sent considerable funding to Michael van der Merwe to secure rights to the three projects and to conduct due diligence, purchase reclamation bonding for the mining project and scoping and other costs, the Pure Africa Sustainable Development Fund and Pure Africa along with our nonprofit social venture partner, Earth Conservancy, did not want to do any projects with Michael van der Merwe. There was a lack of business reporting, a lack of accounting and most of all, Michael van der Merwe maintained close ties with Wextrust Capital. As stated before, a private investigation report was later ordered for Michael van der Merwe, which confirmed that he was not a man to trust[2] as he owned seven or more luxury homes in Pretoria, Waterkloof, Waterkloof Ridge, Midrand and East London, an office building in Midrand, a dozen or more luxury automobiles, motorcycles and other toys and his brother, Pieter, built a 20,000 square foot mansion. This list doesn’t include the assets, which were given to the girlfriends of van der Merwe and Shereshevsky. The Fund and Pure Africa did not want to risk any further involvement with Michael van der Merwe. Despite his claims of profitability and viability of these projects, the decision was made to drop them and it cost hundreds of thousands of dollars in loan capital sent to him that will likely never be recovered.

In 2009, after a lengthy private investigation to locate loan funds sent to Michael van der Merwe on behalf of our financial partners, my brother and I confronted Michael van der Merwe at his luxury oceanfront home in East London, South Africa. I asked Michael van der Merwe,
“what did you do with our financial partner’s loan capital and my money?” A nervous van der Merwe said, “I am in the process of selling the tourism project and I will repay all of your loan money to you and your financial partners.” In blaming Wextrust Capital, he said, “Joe [Shereshevsky] was a thief and we all lost money.” When asked directly about his luxury cars, luxury homes and his brother’s mansion that were all paid for with cash, he said that he “bought them with money given to him by Joe Shereshevsky and Wextrust Capital.” With promises of repayment from van der Merwe, we left after an hour-long meeting. Of course, we all waited for years for a promised repayment from Michael van der Merwe that never came. Naturally, when I was asked by our financial partners about the repayment of our loans, I could only pass along what van der Merwe told us many times: that the projects were being sold and that he would repay all of loan money to us. This – we found out – was one of many lies told to us by Michael van der Merwe and his brother – Pieter. The fact is – they stole the loan money of our financial partners (and of Wextrust Capital’s investors) and used it to buy an estimated ten million dollars of luxury homes, cars and other items for cash.[3]

Again, this was another significant negative action that made us change our entire business strategy and move on to other projects. Thus, Hole in the Wall and the Wild Coast projects became our principle focus.[4]

The Fund managers, Rick, Lou and John, along with Pure Africa, wanted to have someone “on the ground” in Africa and since my brother, Steve, has a passion for missions work, I suggested that he go to Africa to watch over the developments. Steve traveled to Africa in the summer of 2006 with promises of an annual salary plus living expenses. With all of the interruptions, bizarre and criminal conduct and the aggressive bad press campaign, it was very difficult to locate funding partners. Everyone was turned off by the negative press campaign.

One of the first issues Steve encountered was with our local social venture project manager, Bossie Bosman. Shortly after arriving in South Africa, Steve soon discovered that Bossie Bosman has misappropriated funds designated for the Hole in the Wall project to buy a new Landrover LR3 for cash in his personal name at a cost of $100,000 – a devastating blow – as the funds that he misappropriated were supposed to be used to pay the contractual wages for the local community workers, for my brother and the project managers.[5] It was six months worth of budgeted expenses stolen by Bosman to purchase a Landrover for himself. Ultimately, Bossie Bosman was reported to the police in South Africa and he was voted off the Board of Directors of the social venture project.[6] Angry, Bossie Bosman then became the ally of Dr. Batte and Dr. Stiner and they corresponding regularly in their bad press campaign and coup attempt, which commenced in April, 2007.

The beautiful oceanfront and riverfront project at Mdumbi Bay

As our projects on the Wild Coast were moving closer to launching, they had great potential and we received many assurances that the Hole in the Wall and Mdumbi Bay projects would lease out in quickly. This meant millions of potential dollars of revenue for the social venture projects and for the local community. With these funds, all investors could be repaid and the local community would receive a large windfall of profits that they could use to build schools, medical clinics and other needed facilities.

However, despite great potential projects, the intentional damage and interference by Batte, Stiner, Bosman and others killed the project at Mdumbi Bay (see photo above). In June, 2007, the project at Mdumbi Bay was ready to commence marketing by Fresh Properties in East London, South Africa.[7] There were multiple meetings and conference calls between the marketing company, the financial partners and Pure Africa. The project would entail the long-term lease of 46 home sites and a small tourism lodge. On or about June 14, 2007, Fresh Properties set a meeting to discuss the current status of the Mdumbi Bay Marketing Plan. In this correspondence, Mark Trow of Fresh Properties lists “definite potential cash buyers” for 39 of the 46 lots, with names of the buyers listed next to the lot they had chosen, which represented over $6 million in social venture project revenue.[8] However, several anonymous phone calls were made to the South African government claiming that we were trying to “sell” the land instead of “lease” the land to potential buyers. This immediately stopped the marketing effort and in November, 2007, we switched real estate sale companies to Sotheby’s International Realty. Once again, we were so close to a social venture project success before the proverbial rug was pulled out from under us by Bossie Bosman, Batte and others.[9]

Bosman, Batte, Stiner and others then began to utilize the blog of Jeff Brown, a hotel owner and opponent of any development (other than his) at Hole in the Wall. Jeff Brown told my brother that he will do anything he can to stop the development at Hole in the Wall and he became the bulletin board for all of the aggressive bad press, libel, slander and false information against the social venture projects and me. They coordinated with Jeff Brown because he could post all of their information anonymously and he has sent it by automatically generated email to our investors, donors and the general public to discredit the social venture projects and me. They have even utilized the blog to post supposed messages from my children and others – of course – all anonymously. The unfortunate consequence of the Internet is that it is practically impossible to stop someone overseas from posting false and defamatory articles about you.

Hole in the Wall was another social venture project with great potential. Our professional team provided great endorsements of the project. On May 6, 2008, Lofty Nel, a Principal with the firm of Sotheby’s International Realty provided a letter to the project, which reads:

“Lew Geffen Sotheby’s International Realty are extremely proud and honoured to be granted the exclusive mandate to market Pure Africa Development LLC Hole in the Wall project on the Wild Coast in South Africa. Marketing of the project has commenced by word of mouth with the official launch of the project scheduled for the end of May, 2008.

The development comprises 51 Ocean front homes in a gated estate at the Hole in the Wall, a national landmark in South Africa. Earth Conservancy have also been appointed to manage approximately 5000 acres of pristine land adjacent to the project as part of a conservancy. This will ensure that the amazing views and natural beauty of Hole in the Wall will remain intact for guests and owners at the Hole in the Wall development.”[10]

The 51 lots were priced for long term lease at an average price of $120,000 for a total projected revenue to the social venture project of $6 million. The project was on the verge of success.

On September 1, 2008, Russell Linde, South African real estate attorney of the law firm of Smith Tabata provided Dinning and Pure Africa, LLC with a legal opinion letter which states:

“We act on behalf of the aforesaid Pure Africa, LLC as majority shareholder of Incopho Wild Coast Development Projects (Pty) Ltd. Incopho, in turn, is the majority shareholder of the project company, The Reserve at Hole in the Wall (Pty) Ltd. Our firm has represented The Reserve at Hole in the Wall project on behalf of Pure Africa since 2007 as legal counsel. We also assisted in the referral of the project auditor, Charteris & Barnes, auditors.

Based upon a review of the documentation, The Reserve at Hole in the Wall is an oceanfront and oceanview real estate development consisting of 50 stands and a small hotel. The Reserve at Hole in the Wall is being marketed by Lofty Nel of Sotheby’s International Realty in East London, South Africa.

The original documentation for this project dates back to September, 2004. For this letter, I have reviewed the following:

The Final Scoping Report dated September, 2004;

The Review of Documents relating to proposed Coffee Bay and Hole in the Wall developments by East Cape Development Corporation and the Development Bank of South Africa;

The Ground Lease by and between the Kwa Tshezi Community and Earth Conservancy dated February 6, 2006;

The Lease Agreement between The Government of the Republic of South Africa through the Department of Land Affairs, the Kwa Tshezi Community and Incopho dated February 2, 2006;

The Record of Decision from the Department of Affairs, Environment and Tourism dated August 10, 2005 authorizing Incopho “to construct 50 single storey chalets, a central restaurant, a curio shop and amenities and association infrastructure at Hole in the Wall, KSD Municipal Area.

The Lease Agreement between The Government of the Republic of South Africa through the Department of Land Affairs, the Kwa Tshezi Community and Incopho dated June 21, 2008 which is a 30 year renewable lease at the option of Incopho for up to 90 years and continuing thereafter.

It is also my understanding that Title Deed to the land comprising the Hole in the Wall development is forthcoming to the Community in the next 6 months or longer from the Government of South Africa and the Department of Land Affairs.

Based upon a review of this documentation, Incopho has a valid lease with the Government of South Africa and the Kwa Tshezi Community for up to 90 years or more. Under South African law, Incopho through The Reserve at Hole in the Wall (Pty) Ltd. can sublease the 50 stands to interested sublessees for rental payments over the term of the lease or the rent and lease may be prepaid. It is my understanding that sublessees can “purchase” or sublease one or more of the 50 stands for an up-front payment of rent or with 10% downpayment of rent and the balance of the rent payments over 10 years at 12% interest.

It is my understanding that Sotheby’s International Realty will be acting as estate agent in the “sale” of the 50 subleased stands to the general public. A separate company, Villager Homes, will be constructing homes on the 50 subleased stands under separate written agreement between Villager Homes and the stand “purchasers” or sublessees.

Finally, when Title Deed is ultimately vested with the Kwa Tshezi Community, it is planned that the 50 stand sublessees may have the opportunity to convert their lease to Title Deed ownership of their stand.”[11]

By June 2008, all architectural designs, engineering, lot layout, utilities and infrastructure plans were completed and a contract to install all utilities, roads and services to The Reserve at Hole in the Wall were completed. These steps made it possible for marketing of long term leases for the 51 lots by Sotheby’s International Realty.

In May, 2008, Sotheby’s began to issue marketing materials for Hole in the Wall and in September, 2008, Hole in the Wall was listed as a “hot property” in Conde Nast Home in South Africa and Media Press Releases were issued. Sotheby’s also went to great expense to create glossy brochures to begin marketing and they also launched a marketing website for the Hole in the Wall project.

Then, the aggressive bad press campaign team started their bad press campaign in South Africa. This was the most difficult interference that resulted from the aggressive bad press campaign was the anonymous phone calls from this coordinated group to our real estate professional team. At the launch of the Hole in the Wall project and then at the second marketing launch of the project at Mdumbi Bay, Sotheby’s International Realty received several anonymous phone calls from Virginia in the United States and from one or more individuals in South Africa stating that the projects were false, that they did not exist and that I was not someone to be trusted. The callers also threatened to take the matter to the newspapers to discredit Sotheby’s and the social venture projects. In discussions with Sotheby’s, we were told that a new development, especially a social venture development, is a delicate matter and you only want positive information for the general public to view when seeking to spend money on a new oceanfront resort. The decision was made to halt the marketing campaigns and try to regroup under a new development company.[12] This interference also cost us R25,000,000 or $4M from The Development Bank of South Africa.[13]

When another marketing project called The Wild Coast Explorer Club was preparing to launch in the Fall of 2009, similar anonymous phone calls were made to Pam Golding Properties, the real estate company handling the development and launch of this new project. The callers again threatened to take the matter to the newspapers and to tarnish the name of Pam Golding Properties if they continued to represent the project.[14] Sadly, again, this malicious, bad press campaign had succeeded in stopping a very promising project. The Wild Coast Explorer Club had received endorsements from our law firm, accounting firm, real estate professionals, home builders and many others but marketing a new project cannot stand up to bad press – even if it is false.[15]

Each time a project was halted by the malicious and negative actions of Batte and his coordinated bad press campaign, we had to stop everything and try to work on a new project that hadn’t yet been attacked by this group. However, each time the task grew harder and everyone on the social venture team was tired of the negative attacks and the disappointment and damage that resulted from the negative attacks. In 2010, my brother had to return home penniless as he too was paid only a small fraction of the salary and living expenses he was promised by the social venture projects.

With regard to the negative attacks, there are emails, correspondence and witnesses to corroborate and confirm everything that I have said here today. Additionally, in February, 2012, I filed a $30 million civil RICO lawsuit against Batte, Stiner and the group responsible for the aggressive bad press campaign in Suffolk Circuit Court in Virginia. The goal is to recoup the social venture revenue lost to their libel, slander and interference and to complete one or more of the social venture projects, repay the financial partners and provide jobs and profits to the local Xhosa community. It is no wonder that they have filed false reports and charges against me because they have to try to justify their negative actions and cover up their own wrongs.

Finally, many of you may say, the government is accusing you of using funds to buy a luxury home and cars. In 2006, with my consulting contracts in hand from Pure Africa and Earth Conservancy, I was able to put a down payment on a nice home (along with significant financial help from my family) with a large mortgage. In 2008, after learning that all of our money was stolen by Michael van der Merwe and Bosman and the interference by Batte and others, Pure Africa and Earth Conservancy were unable to pay me and my home was sold in a short sale per an agreement with the bank so that we could avoid foreclosure. I sold or had two cars repossessed to pay the car loans. The real difference between my compensation and van der Merwe’s and Bosman’s theft is that I was paid a fraction of the consulting fees promised to me by written consulting agreements and my home and cars were bought with bank financing like most people – not with stolen cash like the van der Merwes and Bosman.[16]

The next and final article in the series is: The Malicious Lawyers: Lying, False Claims, Threats and Insa

[2] In the Investigation Report of Michael van der Merwe dated April, 2008, it is noted that the Lion’s Walk project was sold but the funds never went into the company nor were taxes paid. We are still trying to recover our loan funds from Michael van der Merwe.

[3] There are many more sordid and salacious details to the stories about Joe Shereshevsky, Wextrust Capital and Michael van der Merwe and their rampant thievery and fraud but those stories will have to be told in another Article or series of Articles. The real question is: where are the Volvo loaders, trucks, excavators and other moveable equipment from all those mining projects? Each mining project had approximately $5M of equipment and in my last conversation with van der Merwe – he said he and Wextrust Capital had seven mining projects. That is perhaps $35M of moveable equipment that may be unaccounted for and likely liquidated by the van der Merwes at or about the time of the Wextrust Capital scandal.

[6] We were also told later by local community and governmental leaders that Bosman was a hated man in the local black communities because it was widely known that he was a mean and malicious police officer in the Apartheid era and treated the local people very harshly. It was also rumored that Bosman was present and participated in the beating death of black student peace advocate Stephen Biko in Port Elizabeth. See http://en.wikipedia.org/wiki/Steve_Biko

[9] The $6 million of revenue from the sale of the lease lots at Mdumbi Bay would have paid all project costs, paid back the financial partners of Mdumbi Bay project and generated a significant profit for the local community and our social and financial partners.

[16] The completely false and slanderous news articles written about me state that our financial partners invested or donated $2.9M and I kept $2M. Actually, most of the financial partners were recruited by Dr. John O’Neil, Rick Lally, Lou Dommer, Granville Batte and Dr. McTavish. Of the $2.9M, approximately $800,000 was sent to Michael van der Merwe, Bosman and our project managers as loans and was managed and spent by them presumably on project expenses, $900,000 to the law firm trust account of attorney Gerhard Dreyer for his mining projects with Granville Batte, approximately $250,000 was used to repay loans and settle disputes by financial partners and the balance was used to pay company expenses such as rent, consulting fees for me and others, travel, repayment of loans and other business costs and expenses. From 2005 to 2010, I was paid less than half of the consulting income I was contractually promised by the social venture projects. In 2011 and 2012, I continue to work with social venture community projects in Africa on a volunteer basis without any compensation. I live off consulting income from tax consulting with energy companies, teaching them to utilize tax incentives to become more environmentally-friendly and emitting less pollution.

You may be asking – what are these social venture projects? What is it like at Hole in the Wall? Why would people like Granville Batte, Jeff Brown (White South African hotel owner at Hole in the Wall and slanderous blogger) and Allan Stiner want to steal projects from the community, our social venture partners and me? How about $98,818,000 of the most sought-after beautiful, untouched oceanfront land on the Indian Ocean in South Africa? This is the value of the raw, undeveloped land held by the social venture between the community and Pure Africa as determined by a South African property expert and a real estate developer.[1] To those trying to steal our social venture projects, this is like hitting the lottery – to the local community, it is their future and a means to lift their entire communities out of poverty. My vision is to stop the cycle of Apartheid and the exploitation of the local community at the hands of people like Batte, Stiner and Brown, to a social venture structure where the community owns 25% to 45% of every project. The local impoverished community should and must benefit substantially from the sustainable development of their land – it is their right and heritage.

In order for you to fully understand the above statements, I will share a bit of our project vision for the local people in Africa with you and why the community land is so special. The local Xhosa people live on less than $1.00 per day, on average. They are very poor in a worldly sense but they are blessed with tremendous natural resources – their oceanfront land. The average tribal leader has less than a sixth grade education, so while they have amazing land – they do not have the tools, skills or education to know how to maximize the value of the land. This is where our social venture partners bring in the education, know-how, a professional team of lawyers and real estate companies and the finances to help the local community sustainably develop a real estate project to create jobs, job skills training and hopefully profits. Don’t get me wrong – social venture projects are for-profit – so our goal was to maximize the value of the community land so that the community, our social venture partners and financial partners can all benefit.

Hole in the Wall is a cultural[2] and National icon in South Africa (see photo below). It is a large rock mountain in the Indian Ocean that boasts beautiful scenery and ocean views. In 2004, the Development Bank of South Africa “DBSA” and the South African Government funded a study on creating a tourism project at Hole in the Wall.[3] Our social venture project company was called Incopho, headed up by Bossie Bosman. In 2004, DBSA, the government and Incopho created a project summary for several projects including: Hole in the Wall and the Golf Course at Coffee Bay.[4] In 2005, our social venture partners received a Lease from the South African National Government to develop the community project at Hole in the Wall[5] and a Record of Decision (building permit and authorization) was issued in late 2005.[6]

Views of Hole in the Wall from Development Site

Now, it is well-known that nothing happens in Africa without a meeting: we literally had hundreds of hours of meetings with the local chiefs, the tribal counsel, the community trust and the local people to show them the business plan and the proposed benefits to the local community. In Africa, everyone has a right to speak so the meetings were attended by hundreds of people – both young and old. Once everyone had a chance to voice their opinions and concerns, then we would finalize our social venture project plan. Finally, after our projects were approved by the local community, we then sought approvals from the National, Provincial and local government. Once everyone was happy with and had approved the business plan at a social venture like Hole in the Wall, then we would begin. This initial process takes from 18 months to several years for each project!

At Hole in the Wall, after three years of meetings, the approved plan was to build a tourism site with 50 oceanfront rental homes and a boutique hotel[7] which would create a minimum of 57 jobs for the local community and the potential for hundreds of micro business jobs such as beadwork, tours, sea shell jewelry and other tourism souvenirs and hopefully profits from the development (the community owned 45% of the Hole in the Wall development as our partner).

Architect’s Rendering of Proposed Lodging at Hole in the Wall

In order to help fund the social venture project, Earth Conservancy and The Pure Africa Sustainable Development Fund provided initial funding of $563,000 to pay for engineering fees, architects, plans and approvals and initial project consulting and development costs. However, funding for construction costs and utilities installation was still needed. The Development Bank of South Africa expressed initial interest in providing funding to Incopho as early as 2006.[8] The Development Bank of South Africa then told me that they submitted the social venture project at Hole in the Wall for approval for funding of R25,000,000 or $4,000,000 to put in utilities and facilities.[9] One of the conditions of DBSA funding is matching funds from the social venture partners so we needed financial partners to assist in funding the project at Hole in the Wall.

Our professional team provided great endorsements of the projects. We agreed to approach Sotheby’s International Realty to market the Hole in the Wall project.[10] On May 6, 2008, Lofty Nel, a Principal with the firm of Sotheby’s International Realty provided a letter to the project, which reads:

“Lew Geffen Sotheby’s International Realty are extremely proud and honoured to be granted the exclusive mandate to market Pure Africa Development LLC Hole in the Wall project on the Wild Coast in South Africa. Marketing of the project has commenced by word of mouth with the official launch of the project scheduled for the end of May, 2008.

The development comprises 51 Ocean front homes in a gated estate at the Hole in the Wall, a national landmark in South Africa. Earth Conservancy have also been appointed to manage approximately 5000 acres of pristine land adjacent to the project as part of a conservancy. This will ensure that the amazing views and natural beauty of Hole in the Wall will remain intact for guests and owners at the Hole in the Wall development.”[11]

The 50 lots plus a hotel site were priced for long term lease at an average price of $120,000 per lot for total projected revenue to the social venture project of $6 million.[12] The engineering firm prepared a lot layout for the Hole in the Wall and architects, engineers, and home builders were appointed to get the project ready to market.[13]

In addition to community and government approval, we also sought the approval of specialized real estate legal counsel. On September 1, 2008, Russell Linde, South African real estate attorney of the law firm of Smith Tabata provided Pure Africa with a legal opinion letter:

“We act on behalf of the aforesaid Pure Africa, LLC as majority shareholder of Incopho Wild Coast Development Projects (Pty) Ltd. Incopho, in turn, is the majority shareholder of the project company, The Reserve at Hole in the Wall (Pty) Ltd. Our firm has represented The Reserve at Hole in the Wall project on behalf of Pure Africa since 2007 as legal counsel. We also assisted in the referral of the project auditor, Charteris & Barnes, auditors.

Based upon a review of the documentation, The Reserve at Hole in the Wall is an oceanfront and oceanview real estate development consisting of 50 stands and a small hotel. The Reserve at Hole in the Wall is being marketed by Lofty Nel of Sotheby’s International Realty in East London, South Africa.

The original documentation for this project dates back to September, 2004. For this letter, I have reviewed the following:

The Final Scoping Report dated September, 2004;

The Review of Documents relating to proposed Coffee Bay and Hole in the Wall developments by East Cape Development Corporation and the Development Bank of South Africa;

The Ground Lease by and between the Kwa Tshezi Community and Earth Conservancy dated February 6, 2006;

The Lease Agreement between The Government of the Republic of South Africa through the Department of Land Affairs, the Kwa Tshezi Community and Incopho dated February 2, 2006;

The Record of Decision from the Department of Affairs, Environment and Tourism dated August 10, 2005 authorizing Incopho “to construct 50 single storey chalets, a central restaurant, a curio shop and amenities and association infrastructure at Hole in the Wall, KSD Municipal Area.

The Lease Agreement between The Government of the Republic of South Africa through the Department of Land Affairs, the Kwa Tshezi Community and Incopho dated June 21, 2008 which is a 30 year renewable lease at the option of Incopho for up to 90 years and continuing thereafter.

It is also my understanding that Title Deed to the land comprising the Hole in the Wall development is forthcoming to the Community in the next 6 months or longer from the Government of South Africa and the Department of Land Affairs.

Based upon a review of this documentation, Incopho has a valid lease with the Government of South Africa and the Kwa Tshezi Community for up to 90 years or more. Under South African law, Incopho through The Reserve at Hole in the Wall (Pty) Ltd. can sublease the 50 stands to interested sublessees for rental payments over the term of the lease or the rent and lease may be prepaid. It is my understanding that sublessees can “purchase” or sublease one or more of the 50 stands for an up-front payment of rent or with 10% downpayment of rent and the balance of the rent payments over 10 years at 12% interest.

It is my understanding that Sotheby’s International Realty will be acting as estate agent in the “sale” of the 50 subleased stands to the general public. A separate company, Villager Homes, will be constructing homes on the 50 subleased stands under separate written agreement between Villager Homes and the stand “purchasers” or sublessees.

Finally, when Title Deed is ultimately vested with the Kwa Tshezi Community, it is planned that the 50 stand sublessees may have the opportunity to convert their lease to Title Deed ownership of their stand.”[14]

By May, 2008, all architectural designs, engineering, lot layout, utilities and infrastructure plans were completed and a contract to install all utilities, roads and services to The Reserve at Hole in the Wall were completed. These crucial steps made it possible for marketing of long term leases for the 50 lots by Sotheby’s International Realty.

In May, 2008, Sotheby’s began to issue marketing materials for Hole in the Wall[15] and in September, 2008, Hole in the Wall was listed as a “hot property” in Conde Nast Home in South Africa and Media Press Releases were issued.[16] Sotheby’s also went to great expense to create glossy brochures to begin marketing and they also launched a marketing website for the Hole in the Wall project.[17] Pure Africa and the social venture partners put up a marketing Sign Board at the Hole in the Wall project.[18] Everyone was excited because Sotheby’s and their marketing experts were certain that the property would lease quickly and that meant up to $6 million of projected revenue for the social venture project and the local community.

However, just as the marketing campaign was beginning, the aggressive bad press campaign team of Batte, Stiner and others jumped in to actively interfere with and destroy the marketing efforts at the Hole in the Wall project. This was the most damaging tortious interference that resulted from the aggressive bad press campaign – anonymous phone calls from this coordinated group to our real estate professional team and social venture partners.[19] At the launch of the Hole in the Wall project and at other projects, Sotheby’s International Realty, government officials and others received several anonymous phone calls from Virginia and from South Africa stating that the projects were false, that we were trying to sell (versus lease) community land and that I was not someone to be trusted. The callers also threatened to and did take the matter to the newspapers to discredit Sotheby’s and the social venture projects. In discussions with Sotheby’s and other real estate firms, we were told that a new development, especially a social venture development, is a delicate matter and you only want positive information for the general public to view when seeking to spend money on a new oceanfront resort. The decision was made to halt the marketing campaign at Hole in the Wall and try to regroup later. This was devastating to us because it meant that years of time, effort, money and relationships were wasted.

Each time a project was halted by the malicious and negative actions of Batte and his coordinated bad press campaign, we had to stop everything and try to work on a new project that hadn’t yet been attacked by this group. However, each time the task grew harder and everyone on the social venture team was tired of the negative attacks and the disappointment and damage that resulted from the negative attacks.

While the social venture projects on the Wild Coast in partnership with the Xhosa community have great potential, many people want to take them over for their own personal gain. Why does it seem to be so difficult to help the poor in Africa? I know that Oprah Winfrey had a very hard time starting up her social venture project in Africa[20] and the Washington Post and others have reported on the United Nations aid workers sexual abuse of children[21] and also on billions in stolen aid money[22] and corrupt practices by US companies.[23] In fact, this must be commonplace because I was on the phone with two other social venture project managers in Africa who have had similar experiences to mine.

The next Article describes how Batte, Stiner and others started coordinating with people in Africa in an organized “Wonga-style” coup attempt to either take the social venture projects for themselves or destroy them and me. The next Article is entitled: On the Ground in South Africa: Not Much Better – Social Ventures in Africa.

[1] See Wild Coast Property Valuation at Article 6 FN 1. This valuation was prepared by real estate expert Alan Bell and real estate developer David Stefano based upon comparable property values on existing real estate for sale on the Wild Coast of South Africa.